EXHIBIT 10.12
LICENSE AGREEMENT
THIS LICENSE AGREEMENT (the "Agreement") is entered into as of November 8,
2002 (the "Effective Date") by and between AKESIS PHARMACEUTICALS, INC., having
offices at 0000 Xx Xxxxx Xxxxxxx Xxxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxxxxxx 00000
("Akesis"), and GENDER SCIENCES, INC., a New Jersey corporation, located at 00
Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 ("GS").
RECITALS
WHEREAS, GS desires to obtain from Akesis, and Akesis desires to grant to
GS, an exclusive license under the Licensed Technology to Commercialize (as
defined below) the Products in the Territory, as more fully described herein.
NOW THEREFORE, in consideration of the foregoing and the covenants and
premises contained in this Agreement, the parties agree as follows:
1. DEFINITIONS
The following capitalized terms shall have the meanings indicated for
purposes of this Agreement.
1.1 "Affiliate" shall mean, as to any person or entity, any other person
or entity which directly or indirectly controls, is controlled by, or is under
common control with such person or entity. For purposes of the preceding
definition, "control" shall mean beneficial ownership of more than fifty percent
(50%) of the outstanding shares or securities or the ability otherwise to elect
a majority of the board of directors or other managing authority.
1.2 "Applicable Laws" shall mean (a) all U.S. federal, state and local
laws, statutes, rules, regulations, ordinances (including any amendments
thereto), applicable to the import, export, manufacture and distribution of
Products, including, without limitation, the applicable regulations and
guidelines of the FDA; provided, however, that in the event of any conflict
between the foregoing sources of authority, U.S. federal law and regulations
shall be given priority; and (b) all supranational, national, local and other
laws, statutes, rules, regulations, ordinances (including any amendments
thereto), applicable to the import, export, manufacture and distribution of
Products in any jurisdiction in the Territory outside the U.S. where Akesis or
its Affiliates Commercializes Products.
1.3 "Commercialize" or "Commercialization" shall mean to market, have
marketed, make, have made, manufacture, have manufactured, use, sell, offer for
sale, have sold, distribute, have distributed, import, have imported, and
commercialize in any other manner related thereto.
1
1.4 "Confidential Information" shall mean any confidential or proprietary
information, and any other information relating to any research project, work in
process, future development, scientific, engineering, manufacturing, marketing,
business plan, financial or personnel matter relating to either party, its
present or future products, sales, suppliers, customers, employees, investors or
business, whether in oral, written, graphic or electronic form. Without limiting
the generality of the foregoing, the parties agree that the financial terms of
the Agreement will be considered Confidential Information of both parties.
1.5 "Contract Quarter" shall mean, in any Calendar Year, each successive
period of three (3) consecutive calendar months commencing on the first day of
such a calendar month.
1.6 "Contract Year" shall mean each successive period of twelve (12)
consecutive months commencing on the date that is six (6) months from the
Product Launch Date.
1.7 "Control" shall mean, with respect to any intellectual property right,
possession by a party of the ability (whether by ownership, license or
otherwise) to grant access, a license or a sublicense to such intellectual
property right without violating the terms of any agreement or other arrangement
with any Third Party as of the time such party would first be required hereunder
to grant the other party such access, license or sublicense.
1.8 "FDA" shall mean the United States Food and Drug Administration, or
any successor agency thereto.
1.9 "First Financing" shall mean the closing of the first transaction or
series of transactions in which one or more financial investors purchase equity,
debt, or other securities of GS, or an Affiliate thereof, for aggregate gross
proceeds of US$350,000, or such lesser amount as GS reasonably determines is
necessary to finance the contemplated six (6) month Marketing Test Period (as
defined below).
1.10 "Know-How" shall mean all know-how, trade secrets, data, processes,
techniques, procedures, compositions, devices, methods, formulas, protocols and
information, whether or not patentable, Controlled by Akesis as of the Effective
Date that are: (a) necessary or useful for the manufacture, use or sale of
Products; and (b) are not generally publicly known; but excluding the Licensed
Patents.
1.11 "Licensed Patents" shall mean, to the extent necessary or useful for
the manufacture, use, distribution or sale of Products in the Territory, all
Patents that Akesis Controls as of the Effective Date or during the Term, but
expressly excluding US Patent No. 6,376,549 issued April 23, 2002 entitled
"Metformin-containing compositions for the treatment of diabetes." The Licensed
Patents existing as of the Effective Date are listed in Exhibit A hereto.
1.12 "Licensed Technology" shall mean the Licensed Patents and the
Know-How.
1.13 "Marketing Plan" shall have the meaning provided in Section 3.1.
1.14 "Marketing Test Period" shall mean the marketing test period
commencing on the Effective Date and expiring on the Product Launch Date (as
defined below).
2
1.15 "Net Sales" shall mean the gross revenues actually received in cash
by GS and its Affiliates from sales of Products, less the following items: (i)
transportation and shipping costs where separately charged; (ii) sales, use and
excise taxes and duties paid or allowed by GS and any other governmental charges
imposed upon GS for the production, use, sale or license of the Products; (iii)
actual credits, discounts, allowances and returns granted to customers; and (iv)
normal and customary trade and quantity discounts and allowances. Except as
herein provided, Net Sales shall be determined by using U.S. Generally Accepted
Accounting Principles consistently applied.
1.16 "Patents" shall mean (a) United States patents, re-examinations,
reissues, renewals, extensions and term restorations, and foreign counterparts
of any of the foregoing, and (b) pending applications for United States patents,
including, without limitation, provisional applications, continuations,
continuations-in-part, divisional and substitute applications, including,
without limitation, inventors' certificates, and foreign counterparts of any of
the foregoing.
1.17 "Product" shall mean a micronutrient supplement described in Exhibit
B hereto, in any form, formulation, or derivative thereof that will be marketed
and sold as any product other than an FDA approved drug or prescription
pharmaceutical product.
1.18 "Product Launch Date" shall mean the date on which GS shall initiate
marketing and distribution of Products, which shall be mutually agreed upon by
the parties in good faith, but shall in no event be later than May 1, 2003. The
parties agree that, to the extent practicable, the Product Launch Date will be
the first business day of a calendar month.
1.19 "Second Financing" shall mean the closing of the first transaction or
series of transactions, after the First Financing, in which one or more
financial investors purchase equity, debt, or other securities of GS, or an
Affiliate thereof, for aggregate gross proceeds of US$2,500,000 (excluding the
proceeds of the First Financing), or such lesser amount as GS reasonably
determines is necessary to finance the Commercialization of the Products.
1.20 "Target Customer" shall mean an individual consumer with diabetes,
pre-diabetic symptoms, or prone to diabetes, including, without limitation, the
obese, hyperglycemia and hypoglycemia population.
1.21 "Term" shall have the meaning provided in Section 8.1.
1.22 "Territory" shall mean Xxxxx Xxxxxxx, Xxxxxxx Xxxxxxx xxx Xxxxx
Xxxxxxx.
1.23 "Third Party(ies)" shall mean any entity other than Akesis or GS or
an Affiliate of Akesis or GS.
1.24 "Trademark" shall have the meaning provided in Section 3.3.
2. LICENSE
2.1 License Grant. Subject to the terms and conditions of this Agreement,
Akesis hereby grants to GS during the term of this Agreement an exclusive,
royalty-bearing license, without the right to sublicense, under the Licensed
3
Technology to Commercialize the Products in the Territory. Notwithstanding the
foregoing, GS shall have the right to alter, change or modify the Licensed
Technology to develop and Commercialize prescription pharmaceutical versions of
the Products in the Territory on a non-exclusive basis and subject to the
remaining terms of this Agreement. Akesis acknowledges and agrees that GS shall
have the right to enter into a contract with Third Parties under private label
agreements and/or other strategic or marketing agreements; provided, however
that GS shall remain responsible for any and all performance obligations and
duties required under this Agreement, including, but not limited to, (i) the
Commercially Reasonable and Diligent Efforts (as defined below); (ii) any and
all license fees and royalties provided for herein; and (iii) all other work
required hereunder.
3. MANUFACTURING, MARKETING AND DISTRIBUTION
3.1 Responsibility. Subject to the terms and conditions of this Agreement,
GS shall be solely responsible for the Commercialization of Products in the
Territory. GS shall, and shall cause its Affiliates to, Commercialize Products
in the Territory in accordance with all Applicable Laws, the marketing plan that
is currently being developed by GS (the "Marketing Plan") and the terms of this
Agreement. GS shall present the Marketing Plan to Akesis on or before the
Product Launch Date. GS may amend the Marketing Plan from time to time;
provided, however, that any material changes shall require the mutual written
agreement of the parties hereto.
3.2 Efforts. The license granted to GS under Article 2 is expressly
subject to GS's continuing, during the Term, to use Commercially Reasonable and
Diligent Efforts to Commercialize the Products in the Territory in accordance
with the Marketing Plan. As used herein, "Commercially Reasonable and Diligent
Efforts" shall mean those efforts, consistent with the exercise of prudent
scientific and business judgment, as applied to Commercialization activities.
3.3 Trademarks. The parties shall mutually agree upon one or more
trademarks or trade names for use in the Commercialization of Products in the
Territory (excluding any Akesis or GS corporate trademarks or trade names, the
"Trademarks"), and GS shall Commercialize Products in the Territory using the
applicable Trademark(s). GS shall retain the ownership of the entire right,
title and interest in and to the Trademarks, and all goodwill associated with or
attached to the Trademarks arising out of the use thereof by GS or its
Affiliates shall inure to the benefit of GS. Akesis agrees that it will not
contest, oppose or challenge GS' ownership of the Trademarks. Akesis agrees that
it will not at any time do or suffer to be done any act or thing that will in
any way impair GS' ownership of or rights in and to the Trademarks or any
registration thereof or that may depreciate the value of the Trademarks or the
reputation of GS. GS shall obtain the prior written approval of Akesis of the
form and manner in which the Trademarks will be used upon, in connection with,
or in relation to, the Products, or any packaging, labels, containers,
advertisements and other materials related thereto. GS shall be responsible for
registration, maintenance and enforcement of the Trademarks, including any fees,
costs or expenses in connection therewith. Akesis shall, at GS' request and
expense, assist GS in any action reasonably necessary or desirable to protect
the Trademarks used or proposed to be used hereunder. Akesis shall as soon as
practicable notify GS of any apparent infringement by a Third Party of any of
the Trademarks.
4
4. PAYMENTS
4.1 License Fees. GS shall pay to Akesis up to an aggregate total of
US$400,000 in non-refundable, non-creditable license fees as follows:
(a) US$12,500 in cash on the Effective Date;
(b) US$12,500 in cash within forty-five (45) days of the Effective Date;
(c) US$125,000 in cash following the First Financing and on the earlier
of (i) GS' satisfactory completion of due diligence with respect to
the ingredients of the Products as evidenced by written notice from
GS to Akesis after the Effective Date, or (ii) One Hundred and
Twenty Days (120) from the Effective Date;
(d) US$200,000, in securities of GS (determined based on the per-share
price paid by financial investors in the Second Financing)
concurrently with the closing of the Second Financing.
Notwithstanding the foregoing, if the aggregate proceeds of the
Second Financing are less than $2,500,000, GS shall (i) pay Akesis a
pro rated amount of equity equal to (a) the aggregate proceeds
received therefrom, (b) divided by $2,500,000, (c) multiplied by
$200,000; and (ii) pay Akesis in cash amount equal to the difference
between the value of the securities issued and $200,000 (i.e., for
purposes of example only, if the aggregate proceeds of the Second
Financing are $2,000,000, GS shall pay Akesis US$160,000 in
securities ((2,000,000/2,500,000) ($200,000)= $160,000 and US$40,000
in cash). Such securities shall be of the same class and series as
the securities purchased by financial investors in the Second
Financing, and Akesis shall be entitled to all of the rights
conferred upon financial investors in the Second Financing under any
investor rights, registration rights, voting, co-sale and/or other
comparable agreement entered into by GS and such investors.
Securities payable in this Section 4.1(d) are due at closing of the
Second Financing. Any cash due from this Section 4.1 (d), or in the
event no Second Financing occurs, the entire cash amount shall be
payable monthly in 12 equal cash payments beginning on the Product
Launch Date.
(e) US$50,000 in cash within fourteen (14) days of the Product Launch
Date.
In the event that this Agreement is terminated prior to payment in full of all
license fees set forth in this Section 4.1, (i) Akesis shall be entitled to
retain any payments made under this Section 4.1 prior to such termination, (ii)
GS shall remain obligated to pay any amounts that became due under this Section
4.1 prior to such termination that have not been paid in full, and (iii) GS
shall not be or become obligated to pay any of the foregoing amounts that have
not become due on or before such termination.
4.2 Royalty Payments. GS shall pay to Akesis royalties on Net Sales of
Products by GS and its Affiliates the greater of (i) ten percent (10%) of Net
Sales of Product, or (ii) $1.65 per stock keeping unit (SKU) of Product. GS
shall be entitled to credit earned on royalties paid pursuant to this Section
4.2 against the minimum royalty payments due under Section 4.3.
5
4.3 Minimum Royalty Payments.
(a) Subject to Section 4.3(b) below, commencing six (6) months from the
Product Launch Date, GS shall pay to Akesis the minimum royalty payments set
forth below, determined on a Contract Quarter basis for each Contract Year:
Minimum Royalty
Contract Year Contract Quarter Payment
------------- ---------------- ---------------
One One...................... $25,000
Two...................... $50,000
Three.................... $75,000
Four..................... $100,000
----------
$250,000
Two One...................... $125,000
Two...................... $175,000
Three.................... $200,000
Four..................... $250,000
----------
$750,000
Three One...................... $350,000
Two...................... $450,000
Three.................... $550,000
Four..................... $650,000
----------
$2,000,000
Four One...................... $700,000
Two...................... $725,000
Three.................... $775,000
Four..................... $800,000
----------
$3,000,000
Five One..................... $850,000
Two..................... $950,000
Three................... $1,050,000
Four.................... $1,150,000
----------
$4,000,000
After the initial Term of this Agreement, any renewal Terms under Section 8.1
below shall be subject to ongoing quarterly minimum royalty payments under this
Section 4.3 in the amount of $1,125,000.
(b) The parties hereby acknowledge and agree that the Products contain
an active ingredient known as "vanadyl sulfate hydrate" ("Vanadium"). If, during
the Term of this Agreement or any renewal Terms thereof, any federal, state, or
local law, legislation, rule, regulation, ordinance or code of the United States
or any subdivision thereof relating to Vanadium materially and adversely affects
GS' ability to Commercialize the Products (the "Regulation"), GS shall have no
obligation to pay the minimum royalty payments set forth above for so long as
the Regulation is in effect.
6
4.4 Calculation and Payment of Royalties; Payment of Minimum Royalties.
(a) Payments pursuant to Section 4.2 and reports for the sale of
Products shall be calculated and reported for each calendar month. All payments
due to Akesis pursuant to Section 4.2 shall be paid within ten (10) days of the
end of each calendar month. Each such payment shall be accompanied by a report
of Net Sales of Products in sufficient detail to permit confirmation of the
accuracy of the payment made, including, without limitation, the number of
Products sold by GS and GS has actually received payment for the same, the net
revenues actually received by GS and Net Sales of Products, the royalty payable
under Section 4.2, in U.S. dollars, the method used to calculate such royalty
and the exchange rates used.
(b) Payments pursuant to Section 4.3 shall be due on a Contract Quarter
basis. All payments due to Akesis pursuant to Section 4.3 shall be paid within
ten (10) days of the end of each Contract Quarter. Each such payment shall be
accompanied by a report showing calculation of the amount due, using the amount
specified in Section 4.3, less earned royalties paid under Section 4.2 for the
applicable Contract Quarter.
4.5 Third Party Licenses. If one or more licenses under any Patent(s) of a
Third Party or Parties are required by GS to Commercialize Products in the
Territory as permitted by this Agreement ("Third Party Patent License(s)"),
fifty percent (50%) of any royalties actually paid by GS under such Third Party
Patent License(s) with respect to Commercialization of such Product shall be
creditable against the royalty payments to be paid to Akesis by GS with respect
to the sale of such Product in such country; provided, however, that, on a
Product-by-Product and country-by-country basis, the royalties payable to Akesis
in any given year shall not be reduced by more than fifty percent (50%) of the
royalties that would otherwise be payable under Sections 4.2 and 4.3 hereof.
4.6 Tax Withholding. Akesis will pay any and all taxes levied on account
of payments it is entitled to receive under this Agreement. If any taxes are
required to be withheld by GS, GS will (a) deduct such taxes from the payment
made to Akesis, (b) timely pay the taxes to the proper taxing authority, and (c)
send proof of payment to Akesis and certify its receipt by the taxing authority
within thirty (30) days following such payment.
4.7 Exchange Rate; Manner and Place of Payment. All payments hereunder
shall be payable in U.S. dollars. With respect to each quarter, for countries
other than the United States, whenever conversion of payments from any foreign
currency shall be required, such conversion shall be made at the rate of
exchange reported in The Wall Street Journal, Western Edition, on the last
business day of the applicable calendar month or Contract Quarter. All payments
owed under this Agreement shall be made by wire transfer to a bank and account
designated in writing by Akesis, unless otherwise specified in writing by
Akesis.
4.8 Late Payments. In the event that any payment due hereunder is not made
when due, the payment shall accrue interest from the date due at the rate of one
and one-half percent (1.5%) per month; provided, however, that in no event shall
such rate exceed the maximum legal annual interest rate. The payment of such
interest shall not limit Akesis from exercising any other rights it may have as
a consequence of the lateness of any payment.
7
4.9 Records; Audits. During the term of this Agreement and for a period of
three (3) years thereafter, GS shall keep complete and accurate records
pertaining to the sale or other disposition of Products in sufficient detail to
permit Akesis to confirm the accuracy of payments due hereunder. Akesis shall
have the right to cause an independent, certified public accountant reasonably
acceptable to GS to audit such records to confirm Net Sales and royalty payments
for a period covering not more than the preceding three (3) years. Akesis agrees
to treat, and to use its best efforts to cause such accountant to treat, all
such information as confidential and not to use or disclose any such information
for any purpose except to determine compliance with this Agreement. For the
avoidance of doubt, GS shall not be obligated to provide Akesis or such
accountant with access to any records or information other than that which is
necessary to confirm Net Sales and royalty payments hereunder. Such audits may
be exercised during normal business hours upon reasonable prior written notice
to GS. Prompt adjustments shall be made by the parties to reflect the results of
such audit. Akesis shall bear the full cost of such audit unless such audit
discloses a variance of more than seven and one-half percent (7.5%) from the
amount of royalties due under this Agreement, in which case, GS shall bear the
full cost of such audit.
5. INTELLECTUAL PROPERTY
5.1 Ownership of Licensed Technology. Akesis shall at all times remain the
sole and exclusive owner of the Licensed Technology.
5.2 Patent Prosecution and Maintenance. Akesis shall file, prosecute and
maintain all patent applications and patents included in the Licensed Patents.
Akesis shall provide GS with an opportunity to review and discuss with Akesis
prosecution strategy and to consult with Akesis on the content of patent
filings. Akesis shall be responsible for all costs, fees and expenses incurred
from and after the Effective Date in connection with the filing and prosecution
of such patent applications and the maintenance of such patents. Akesis agrees
to notify GS in writing in a timely manner if it does not desire to support the
continued prosecution or appeals or maintenance of any Licensed Patent. In the
event Akesis declines to pursue, or does not, within sixty (60) days following
written request from GS, take reasonably requested action with respect to the
filing, prosecution or maintenance of any Licensed Patent, GS may, at its own
expense, continue to prosecute or maintain such Licensed Patent in the name and
on behalf of Akesis; provided, however that GS shall be entitled, at Akesis'
option, to either (i) a credit earned on reasonable expenses GS incurs in
connection with therewith against the minimum royalty payments due under Section
4.3; or (ii) reimbursement of all sums spent by GS in connection with the
maintenance of the same.
5.3 Patent Enforcement. Each party shall promptly notify the other in
writing of any alleged or threatened infringement of any patent included in the
Licensed Patents of which such party becomes aware.
(a) With respect to any infringement of any patent included in the
Licensed Patents, Akesis shall bring and control any action or proceeding with
respect to such infringement at its own expense and by counsel of its own
choice, and, solely to the extent such infringement involves the manufacture,
use or sale of any product that would compete with the Products in the
Territory, GS shall have the right, at its own expense, to be represented in any
such action by counsel of its own choice. To the extent such infringement
involves the
8
manufacture, use or sale of any product that would compete with the Products in
the Territory, if Akesis fails to bring an action or proceeding within (i) sixty
(60) days following the notice of alleged infringement or (ii) ten (10) days
before the time limit, if any, set forth in the applicable laws and regulations
for the filing of such actions, whichever comes first, GS shall have the right,
but not the obligation, to bring and control any action or proceeding with
respect to such infringement at its own expense and by counsel of its own
choice, and Akesis shall have the right, at its own expense, to be represented
in any such action by counsel of its own choice. GS shall be entitled, at
Akesis' option, to either (i) a credit earned on litigation and reasonable
expenses GS incurs in connection with its enforcement of the Licensed Patents
against the minimum royalty payments due under Section 4.3, less any net
recovery realized by GS as a result of such litigation; or (ii) reimbursement of
all sums spent by GS in connection with its enforcement of the same.
(b) In the event a party brings an infringement action in accordance
with this Section 5.3, the other party shall cooperate fully, including if
required to bring such action, the furnishing of a power of attorney. Neither
party shall have the right to settle any patent infringement litigation under
this Section 5.3 in a manner that diminishes the rights or interests of the
other party without the consent of such other party (which shall not be
unreasonably withheld). Any recovery realized as a result of such litigation,
after reimbursement of any litigation expenses of Akesis and/or GS, as the case
may be, shall be retained by the party that brought and controlled such
litigation for purposes of this Agreement, except that any recovery realized by
GS as a result of such litigation, after reimbursement of the parties'
respective litigation or other reasonable expenses, shall, to the extent
attributable to lost sales of Products, be treated as Net Sales of Products by
GS.
5.4 Third Party Infringement Claims. Each party shall promptly notify the
other in writing of any allegation by a Third Party that the practice of the
Licensed Technology infringes or may infringe the intellectual property rights
of such Third Party. A party shall have the sole right to control any defense of
any such claim involving alleged infringement of Third Party rights by such
party's activities at its own expense and by counsel of its own choice. Neither
party shall have the right to settle any patent infringement litigation under
this Section 5.4 relating to the Licensed Technology in a manner that diminishes
the rights or interests of the other party without the consent of such other
party (which shall not be unreasonably withheld). Notwithstanding any other
provision herein to the contrary, this Section 5.4 shall not apply to any
Indemnified Claims (as defined below).
5.5 Cooperation of the Parties. Each party agrees to cooperate fully in
the preparation, filing, and prosecution of any Licensed Patents under this
Agreement and in the obtaining and maintenance of any patent extensions,
supplementary protection certificates and the like with respect to any Licensed
Patent. Such cooperation includes, but is not limited to, promptly informing the
other party of any matters coming to such party's attention that may affect the
preparation, filing, prosecution or maintenance of any Licensed Patents.
6. CONFIDENTIALITY
6.1 Confidentiality. Except to the extent expressly authorized by this
Agreement or otherwise agreed in writing by the parties, the parties agree that,
during the term of this
9
Agreement, and for a period of five (5) years thereafter, each party (the
"Receiving Party") will maintain in confidence all Confidential Information
disclosed by the other party (the "Disclosing Party"). The Receiving Party may
use the Confidential Information of the Disclosing Party only to the extent
required to accomplish the purposes of this Agreement. The Receiving Party shall
use at least the same standard of care as it uses to protect proprietary or
confidential information of its own to ensure that its employees, agents,
consultants and other representatives do not disclose or make any unauthorized
use of the Disclosing Party's Confidential Information. Each party will promptly
notify the other upon discovery of any unauthorized use or disclosure of the
other party's Confidential Information.
6.2 Exceptions. The obligations of confidentiality contained in Section
6.1 will not apply to the extent that it can be established by the Receiving
Party by competent proof that such Confidential Information:
(a) was already known to the Receiving Party, other than under an
obligation of confidentiality, at the time of disclosure by the Disclosing
Party;
(b) was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the Receiving Party;
(c) became generally available to the public or otherwise part of the
public domain after its disclosure and other than through any act or omission of
the Receiving Party in breach of this Agreement; or
(d) was disclosed to the Receiving Party, other than under an obligation
of confidentiality, by a Third Party who had no obligation to the Disclosing
Party not to disclose such information to others.
6.3 Authorized Disclosure. Each party may disclose the other party's
Confidential Information to the extent such disclosure is reasonably necessary
in the following instances:
(a) filing, prosecuting or maintaining the Licensed Patents in
accordance with this Agreement;
(b) in the case of GS, practicing the license granted hereunder or
preparing and submitting regulatory filings with respect to Products;
(c) prosecuting or defending litigation or complying with applicable
court orders or governmental regulations; or
(d) disclosure to Affiliates, employees, consultants, agents or other
Third Parties in connection with due diligence or similar investigations by such
Third Parties, and disclosure to potential Third Party investors in confidential
financing documents, provided, in each case, that any such Affiliate, employee,
consultant, agent or Third Party agrees to be bound by similar terms of
confidentiality and non-use at least equivalent in scope to those set forth in
this Article 5.
10
Notwithstanding the foregoing, in the event a party is required to make a
disclosure of the other party's Confidential Information pursuant to Section
6.3(c), it will, except where impracticable, give reasonable advance notice to
the other party of such disclosure and use efforts to secure confidential
treatment of such information at least as diligent as such party would use to
protect its own confidential information, but in no event less than reasonable
efforts. In any event, the parties agree to take all reasonable action to avoid
disclosure of Confidential Information hereunder. The parties will consult with
each other on the provisions of this Agreement to be redacted in any filings
made by the parties with the Securities and Exchange Commission or as otherwise
required by law.
6.4 Existing Confidentiality Agreement. In addition to the confidentiality
obligations set forth herein, the parties hereby acknowledge and agree that they
each continue to be bound by the obligations and duties set forth in that
certain confidentiality agreement currently in effect dated June 6, 2002 by and
between the parties hereto.
6.5 Non-Circumvention. Akesis agrees that during the Term of this
Agreement, it shall not directly circumvent or interfere with GS' relationships
with respect to (a) any GS customers existing prior to any expiration or
termination of this Agreement; and (b) Third Party Subcontractors, distributors,
salespersons, or other marketing and sales relationships. In addition, during
the Term of this Agreement, Aksesis shall not enter into a relationship with any
Third Party that Akesis knows or would have reason to know would have the effect
of circumventing or interfering with GS' relationships with respect to (a) or
(b) above. Akesis hereby acknowledges and agrees that this provision shall
survive any termination or expiration of this Agreement for so long as GS
continues to (i) Commercialize the Products during the Sunset Period, as defined
and described in Section 8.4(a)(ii) below; or (ii) Commercialize the Products to
customers existing prior to such termination or expiration, as provided for in
Section 8.4(a)(iii) below.
7. REPRESENTATIONS AND WARRANTIES
The following Representations and Warranties are made as of the Effective
Date of the Agreement.
7.1 Representations and Warranties of Akesis.
(a) Authority to License. Akesis represents and warrants to GS that: (i)
Akesis has full power and authority to grant the rights granted by this
Agreement to GS, that no consent of any other person or entity is required by
Akesis to grant such rights other than consents that have been obtained and are
in effect, and that neither the performance of this Agreement by Akesis, nor the
license to GS of the Licensed Technology or Products will in any way violate any
non-disclosure agreement, (ii) there are no outstanding liens, encumbrances,
agreements or understandings of any kind, either written, oral or implied,
regarding the Licensed Technology which are inconsistent or in conflict with any
provision of this Agreement, and (iii) to Akesis' knowledge, neither the
practice of the Licensed Technology as practiced by Akesis up to the Effective
Date, nor the Commercialization of Products as Commercialized by Akesis up to
the Effective Date, infringes the intellectual property rights of any Third
Party in the Territory.
11
(b) Regulatory Approval. Akesis represents that it is not aware of any
specific regulatory approval required to market the Products.
(c) Clinical Finding. Within its existing customer base and open label
studies, results of which have been provided to GS, Akesis is not aware of
material adverse events associated with use of the Product.
(d) Litigation Warranty. Akesis represents and warrants that there is no
pending litigation which alleges that the practice of the Akesis Technology
would infringe or misappropriate any intellectual property rights of any Third
Party, and Akesis has not received any written communication threatening any
such litigation, and to its knowledge Akesis' has not received any verbal
communication threatening any such litigation.
7.2 Mutual Representations and Warranties. Each party hereby represents
and warrants to the other party that: (a) it is duly authorized to execute and
deliver this Agreement and to perform its obligations hereunder; (b) this
Agreement is a legal and valid obligation binding upon it and enforceable in
accordance with its terms; and (c) the execution, delivery and performance of
this Agreement do not conflict with any agreement, instrument or understanding,
oral or written, to which it is a party or by which it may be bound, nor violate
any law or regulation of any court, governmental body or administrative or other
agency having jurisdiction over it.
7.3 Disclaimer. Except as expressly set forth herein, THE TECHNOLOGY AND
INTELLECTUAL PROPERTY RIGHTS PROVIDED BY AKESIS HEREUNDER ARE PROVIDED "AS IS"
AND AKESIS EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES OF ANY KIND, EXPRESS OR
IMPLIED, INCLUDING WITHOUT LIMITATION THE WARRANTIES OF DESIGN, MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY
RIGHTS OF THIRD PARTIES, OR ARISING FROM A COURSE OF DEALING, USAGE OR TRADE
PRACTICES, IN ALL CASES WITH RESPECT THERETO.
7.4 Limitation of Liability. EXCEPT FOR PAYMENTS UNDER ARTICLE 4 OR
LIABILITY FOR BREACH OF ARTICLE 6, NEITHER PARTY SHALL BE ENTITLED TO RECOVER
FROM THE OTHER PARTY ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES
IN CONNECTION WITH THIS AGREEMENT OR ANY LICENSE GRANTED HEREUNDER; provided,
however, that this Section 7.4 shall not be construed to limit either party's
indemnification obligations under Article 9.
8. TERM; TERMINATION
8.1 Term. The term of this Agreement will commence as of the Effective
Date and, unless sooner terminated as provided hereunder, will continue in full
force and effect for sixty-six (66) months after the Product Launch Date (as the
same may be extended, the "Term"). Provided that GS has satisfied all of its
respective obligations set forth herein, the Term shall automatically renew for
additional consecutive one (1) year terms unless GS notifies Akesis in writing
12
of its intent not to renew at least ninety (90) days before the expiration of
the then current Term.
8.2 Termination for Cause. Each party shall have the right to terminate
this Agreement upon forty-five (45)days written notice to the other upon the
occurrence of any of the following:
(a) Upon or after bankruptcy, insolvency, dissolution or winding up of
the other party (other than a dissolution or winding up for the purpose of
reconstruction, amalgamation or reorganization); or
(b) Upon or after the breach of any material provision of this Agreement
by the other party if the breaching party has not cured such breach within the
forty-five (45) day period following written notice of termination by the
non-breaching party (the "Cure Period"). Notwithstanding the foregoing, if,
within the Cure Period, the defaulting party has commenced curing the default
and continues proceeding with all due diligence to cure the default, then the
Cure Period shall be automatically extended for a reasonable amount of time, but
in no event more than an additional forty-five (45) days, to allow for the
defaulting party to cure the same.
(c) Notwithstanding any other provision of this Agreement to the
contrary, failure by GS to make payments hereunder when due shall constitute a
material breach of this Agreement. Furthermore, at Akesis' option this Agreement
shall be subject to immediate termination if License Fees payable under Section
4.1 are not received within seven (7) days from the date due, and Royalty and
Minimum Royalty payments under Sections 4.2 and 4.3 are not received within
forty-five (45) days from the date due.
8.3 Additional Termination Rights of Akesis. In addition to the
termination rights set forth in Section 8.2, Akesis shall have the right to
terminate this Agreement as follows:
(a) Upon written notice to GS in the event that GS has not completed the
First Financing within ninety (90) days of the Effective Date; provided,
however, that if, at the end of such ninety (90) day period, GS has executed a
term sheet or similar documentation with one or more Third Parties regarding the
First Financing, then GS shall have an additional sixty (60) days to complete
the First Financing, and if GS has not completed the First Financing prior to
the end of such additional sixty (60) day period, then Akesis may terminate this
Agreement upon written notice to GS; or
(b) Upon written notice to GS in the event that GS has not completed the
Second Financing prior to the Product Launch Date.
8.4 Additional Termination Rights of GS. In addition to the termination
rights set forth in Section 8.2, GS shall have the right to terminate this
Agreement at any time during the Marketing Test Period, if GS, in its sole and
absolute discretion, elects not to proceed with the licensing arrangement
contemplated herein and provides Akesis written notification of the same (the
"Notice").
13
8.5 Effect of Termination; Surviving Obligations.
(a) Upon termination of this Agreement pursuant to Sections 8.1, 8.2,
8.3, and 8.4, or upon expiration of this Agreement in accordance with its terms:
(i) the license granted by Akesis to GS in Article 2 shall
terminate;
(ii) for consideration totaling US$1.00 (one dollar), GS shall
transfer and assign to Akesis all of its right, title and interest in and to the
Trademarks and all goodwill associated with or attached to the Trademarks
arising out of the use thereof by GS and its Affiliates and shall take such
other actions and execute such other instruments, assignments and documents as
may be necessary to effectuate such assignment to Akesis;
(iii) in the event of any expiration or termination of this
Agreement, Akesis shall, and it hereby does, grant to GS a non-exclusive,
royalty-bearing license, without the right to sublicense, under the Licensed
Technology to Commercialize any Products in inventory or ordered and/or accepted
as of the date of the termination or expiration of this Agreement, subject to
GS' compliance and payment of royalty payments in accordance with Section 4.2
(but not minimum royalties under Section 4.3) and all other applicable
provisions of this Agreement. (the "Sunset Period"). The foregoing license
includes the right to use the Trademarks in connection with the
Commercialization of the Products during the Sunset Period.
(iv) Akesis shall, and it hereby does, grant to GS a non-exclusive,
royalty-bearing license, without the right to sublicense, under the Licensed
Technology to Commercialize the Products in the Territory solely for sale or
distribution to customers existing prior to such termination (as evidenced by
the consummation by such customer of at least one (1) SKU of Product, including
payment in full therefor, prior to termination of this Agreement), subject to
the ongoing compliance and payment of royalty payments in accordance with
Section 4.2 (but not minimum royalties under Section 4.3) and all other
applicable provisions of this Agreement. The foregoing license includes the
right to use the Trademarks in connection with the Commercialization of Products
in the Territory, subject to the provisions of Section 3.3; and
(v) all other rights and obligations of the parties under this
Agreement shall terminate, except as set forth in this Section 8.4.
(b) For the avoidance of doubt, in no event shall a change in control of
a party be deemed to give rise to any right of termination of this Agreement by
either party.
(c) Expiration or termination of this Agreement shall not relieve the
parties of any obligation accruing prior to such expiration or termination.
Except as expressly set forth elsewhere in this Agreement, the obligations and
the rights of the parties under Sections 4.4, 4.5, 4.6, 4.7, 4.8, 4.9, 5.1, 7.3
and 7.4 and Articles 6, 8, 9 and 10 shall survive expiration or termination of
this Agreement.
8.6 Rights in Bankruptcy. All rights and licenses granted under or
pursuant to this Agreement by Akesis are, and will otherwise be deemed to be,
for purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of right to
"intellectual property" as defined under Section 101 of the U.S. Bankruptcy
14
Code. The parties agree that GS, as licensee of such rights under this
Agreement, will retain and may fully exercise all of its rights and elections
under the U.S. Bankruptcy Code. The parties further agree that, in the event of
the commencement of a bankruptcy proceeding by or against Akesis under the U.S.
Bankruptcy Code, GS will be entitled to a complete duplicate of (or complete
access to, as appropriate) any such intellectual property and all embodiments of
such intellectual property, and same, if not already in its possession, will be
promptly delivered to them (i) upon any such commencement of a bankruptcy
proceeding upon its written request therefor, unless Akesis elects to continue
to perform all of its obligations under this Agreement, or (ii) if not delivered
under (i) above, following the rejection of this Agreement by or on behalf of
Akesis upon written request therefor by GS.
8.7 Remedies. In the event of any breach of any provision of this
Agreement, in addition to the termination rights set forth herein, each party
shall have all other rights and remedies at law or equity to enforce this
Agreement.
9. INDEMNIFICATION
9.1 Indemnification by GS. GS hereby agrees to save, defend, indemnify and
hold harmless Akesis, its Affiliates and their respective directors, officers,
employees and agents (each, an "Indemnitee") from and against any and all
losses, damages, liabilities, expenses and costs, including reasonable legal
expenses and attorneys' fees ("Losses"), to which an Indemnitee may become
subject as a result of any claim, demand, action or other proceeding by any
Third Party to the extent such Losses arise directly or indirectly out of GS or
its Affiliates' (i) the breach by GS of any covenant, representation or warranty
contained in this Agreement; (ii) the gross negligence or willful misconduct of
GS; or (iii) Commercialization of the Products, except to the extent such Losses
(a) result from the gross negligence or willful misconduct of any Indemnitee; or
(b) are indemnified by Akesis under Section 9.2 below.
9.2 Indemnification by Akesis. Akesis hereby agrees to save, defend,
indemnify and hold harmless GS, its Affiliates and their respective employees,
officers, directors and agents (each, a "GS Indemnified Party") from and against
any Losses to which a GS Indemnified Party may become subject as a result of any
claim, demand, action or other proceeding by any Third Party based upon (i) the
breach by Akesis of any covenant, representation or warranty contained in this
Agreement; (ii) the gross negligence or willful misconduct of Akesis; or (iii) a
suit or claim alleging that GS' Commercialization of Products (as such Products
exist as of the Effective Date and with labeling that is consistent in all
material respects with the labeling used by Akesis prior to the Effective Date)
in the Territory in accordance with this Agreement infringes the intellectual
property rights of a Third Party (the "Indemnified Claims").
9.3 Conditions to Indemnification. The obligations of the indemnifying
party under Sections 9.1 and 9.2 are conditioned upon the delivery of written
notice to the indemnifying party of any potential Losses promptly after the
indemnified party becomes aware of such potential Losses. In the event of the
assertion or commencement by any Third Party of any suit or claim with respect
to which the indemnifying party may become obligated to indemnify, hold
harmless, compensate or reimburse any indemnitee pursuant to Section 9.1 or 9.2,
the indemnifying party shall assume the defense of such suit or claim, at the
sole expense of the indemnifying party, within the time allowed for responding
to such suit or claim. In that event:
15
(a) the indemnifying party shall proceed to defend such suit or claim in
a diligent manner with counsel reasonably satisfactory to the indemnified party;
(b) the indemnified party shall make available to the indemnifying party
any non-privileged documents and materials in the possession of the indemnified
party that may be necessary to the defense of such suit or claim;
(c) the indemnifying party shall keep the indemnified party informed of
all material developments and events relating to such suit or claim; and
(d) the indemnified party shall have the right to participate in the
defense of such suit or claim at its sole expense.
If the indemnifying party does not assume the defense of any such suit or claim
within the time allowed (a "Failure to Defend"), the indemnified party may
proceed with the defense of such suit or claim on its own. If the indemnified
party so proceeds with the defense of any such suit or claim on its own:
(i) all expenses relating to the defense of such suit or claim
shall be borne and paid exclusively by the indemnified party; provided, however,
that the indemnified party shall have the right to withhold and deduct any sum
that may be owed to the indemnifying party under Section 9.1 or 9.2 from any
amount otherwise payable by the indemnified party to the indemnifying party. The
withholding and deduction of any such sum shall operate for all purposes as a
complete discharge (to the extent of such sum) of the obligation to pay the
amount from which such sum was withheld and deducted;
(ii) the indemnifying party shall make available to the indemnified
party any documents and materials in the possession or control of either of the
indemnifying party that may be necessary to the defense of such suit or claim;
and
(iii) the indemnified party shall keep the indemnifying party
informed of all material developments and events relating to such suit or claim.
9.4 Settlements. Neither party may settle a claim or action related to any
Losses without the consent of the other party, if such settlement would impose
any monetary obligation on the other party or require the other party to submit
to an injunction or otherwise limit the other party or its Affiliates,
employees, agents, officers and directors . Notwithstanding the foregoing, in
the event of a Failure of Defend, the indemnified party shall have the right
settle any such claim or action. In that event, the indemnified party shall have
the right to withhold and deduct the entire settlement amount from any amount
otherwise payable by the indemnified party to the indemnifying party.
9.5 Insurance. From and after such time as GS or its Affiliates first
manufactures or distributes any Product, GS, at its own expense, shall maintain
product liability insurance naming Akesis as an additional insured in an amount
consistent with industry standards and GS' own policies, but in no event less
than one million dollars ($1,000,000) per each occurrence, subject to an
aggregate limit of two million dollars ($2,000,000) per annum plus a one million
dollar ($1,000,000) umbrella, during the Term of the Agreement. GS shall use its
best efforts to obtain a five million dollar ($5,000,000) limit if and when
16
available or economically feasible, on terms and conditions as determined in GS'
reasonable discretion.
10. MISCELLANEOUS PROVISIONS
10.1 Governing Law; Arbitration. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of California, excluding
those laws that direct the application of the laws of another jurisdiction. The
parties agree that any and all disputes, claims or controversies arising out of
or relating to this Agreement (excluding, in any event, any dispute relating to
patent scope, validity or infringement arising under this Agreement) that are
not resolved by their mutual agreement shall be submitted to final and binding
arbitration in San Diego County, California before JAMS, or its successor,
pursuant to the United States Arbitration Act, 9 U.S.C. Sec. 1 et seq. Either
party may commence the arbitration process called for in this Agreement by
filing a written demand for arbitration with JAMS, with a copy to the other
party. The arbitration will be conducted in accordance with the provisions of
JAMS' Streamlined Arbitration Rules and Procedures in effect at the time of
filing of the demand for arbitration. The parties will cooperate with JAMS and
with one another in selecting an arbitrator from JAMS' panel of neutrals, and in
scheduling the arbitration proceedings. The parties covenant that they will
participate in the arbitration in good faith. The arbitrator shall be authorized
to award compensatory damages, but shall NOT be authorized (i) to award
non-economic or punitive damages, or (ii) to reform, modify or materially change
this Agreement; provided, however, that the damage limitations described in part
(i) of this sentence will not apply if such damages are statutorily imposed. The
arbitrator also shall be authorized to grant any temporary, preliminary or
permanent equitable remedy or relief they deem just and equitable and within the
scope of this Agreement, including, without limitation, an injunction or order
for specific performance. Each party shall bear its own attorney's fees, costs,
and disbursements arising out of the arbitration, and shall pay an equal share
of the fees and costs of the arbitrator; provided, however, the arbitrator shall
be authorized to determine whether a party is the prevailing party, and if so,
to award to that prevailing party reimbursement for its reasonable attorneys'
fees, costs and disbursements and/or the fees and costs of the arbitrator. Each
party shall fully perform and satisfy the arbitration award within fifteen (15)
days of the service of the award. By agreeing to this binding arbitration
provision, the parties understand that they are waiving certain rights and
protections which may otherwise be available if a claim between the parties were
determined by litigation in court, including, without limitation, the right to
seek or obtain certain types of damages precluded by this provision, the right
to a jury trial, certain rights of appeal, and a right to invoke formal rules of
procedure and evidence. Judgment upon the award rendered by the panel shall be
final and nonappealable and may be entered in any court having jurisdiction
thereof. The provisions of this paragraph may be enforced by any court of
competent jurisdiction, and the party seeking enforcement shall be entitled to
an award of all costs, fees and expenses, including reasonable attorneys fees,
to be paid by the party against whom enforcement is ordered.
10.2 Entire Agreement; Modification. This Agreement (including the
Exhibits hereto) is both a final expression of the parties' agreement and a
complete and exclusive statement with respect to all of its terms. This
Agreement supersedes all prior and contemporaneous agreements and
communications, whether oral, written or otherwise, concerning any and all
matters contained herein, including, without limitation, the Letter of Intent
17
dated July 26, 2002, by and between the parties hereto. No rights or licenses
with respect to any intellectual property of either party are granted or deemed
granted hereunder or in connection herewith, other than those rights expressly
granted in this Agreement. No trade customs, courses of dealing or courses of
performance by the parties shall be relevant to modify, supplement or explain
any term(s) used in this Agreement. This Agreement may not be modified or
supplemented by any purchase order, change order, acknowledgment, order
acceptance, standard terms of sale, invoice or the like. This Agreement may only
be modified or supplemented in a writing expressly stated for such purpose and
signed by the parties to this Agreement.
10.3 Relationship Between the Parties. The parties' relationship, as
established by this Agreement, is solely that of independent contractors. This
Agreement does not create any partnership, joint venture or similar business
relationship between the parties. Neither party is a legal representative of the
other party, and neither party can assume or create any obligation,
representation, warranty or guarantee, express or implied, on behalf of the
other party for any purpose whatsoever.
10.4 Non-Waiver. The failure of a party to insist upon strict performance
of any provision of this Agreement or to exercise any right arising out of this
Agreement shall neither impair that provision or right nor constitute a waiver
of that provision or right, in whole or in part, in that instance or in any
other instance. Any waiver by a party of a particular provision or right shall
be in writing, shall be as to a particular matter and, if applicable, for a
particular period of time and shall be signed by such party.
10.5 Assignment. Except as expressly provided hereunder, neither this
Agreement nor any rights or obligations hereunder may be assigned or otherwise
transferred by either party without the prior written consent of the other party
(which consent shall not be unreasonably withheld); provided, however, that
either party may assign this Agreement and its rights and obligations hereunder
without the other party's consent to an Affiliate or in connection with the
transfer or sale of all or substantially all of the business of such party to
which this Agreement relates to a Third Party, whether by merger, sale of stock,
sale of assets or otherwise. In the event of such transaction, however,
intellectual property rights of the acquiring party to such transaction (if
other than one of the parties to this Agreement) shall not be included in the
technology licensed hereunder. The rights and obligations of the parties under
this Agreement shall be binding upon and inure to the benefit of the successors
and permitted assigns of the parties. Any assignment not in accordance with this
Agreement shall be void.
10.6 No Third Party Beneficiaries. This Agreement is neither expressly nor
impliedly made for the benefit of any party other than those executing it.
10.7 Severability. If, for any reason, any part of this Agreement is
adjudicated invalid, unenforceable or illegal by a court of competent
jurisdiction, such adjudication shall not affect or impair, in whole or in part,
the validity, enforceability or legality of any remaining portions of this
Agreement. All remaining portions shall remain in full force and effect as if
the original Agreement had been executed without the invalidated, unenforceable
or illegal part.
18
10.8 Notices. Any notice to be given under this Agreement must be in
writing and delivered either in person, by any method of mail (postage prepaid)
requiring return receipt, or by overnight courier or facsimile confirmed
thereafter by any of the foregoing, to the party to be notified at its
address(es) given below, or at any address such party has previously designated
by prior written notice to the other. Notice shall be deemed sufficiently given
for all purposes upon the earlier of: (a) the date of actual receipt; (b) if
mailed, three calendar days after the date of postmark; or (c) if delivered by
overnight courier, the next business day the overnight courier regularly makes
deliveries.
If to Akesis, notices must be addressed to:
Akesis Pharmaceuticals, Inc.
0000 Xx Xxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to GS, notices must be addressed to:
Gender Sciences, Inc.
00 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxx Xxxxx, Chairman
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Xxxxx & Xxxxxxx
000 Xxxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
10.9 Force Majeure. Each party shall be excused from liability for the
failure or delay in performance of any obligation under this Agreement (other
than the obligation to make payment when due) by reason of any event beyond such
party's reasonable control including but not limited to Acts of God, fire,
flood, explosion, earthquake, or other natural forces, war, civil unrest,
accident, destruction or other casualty, any lack or failure of transportation
facilities, any lack or failure of supply of raw materials, any strike or labor
disturbance, or any other event similar to those enumerated above. Such excuse
from liability shall be effective only to the extent and duration of the
event(s) causing the failure or delay in performance and provided that the party
has not caused such event(s) to occur. Notice of a party's failure or delay in
performance due to force majeure must be given to the other party within ten
(10) calendar days after its occurrence. All delivery dates under this Agreement
that have been affected by force majeure shall be tolled for the duration of
19
such force majeure. In no event shall any party be required to prevent or settle
any labor disturbance or dispute.
10.10 Legal Fees. If any party to this Agreement resorts to any legal
action or arbitration in connection with this Agreement, the prevailing party
shall be entitled to recover reasonable fees of attorneys and other
professionals in addition to all court costs and arbitrator's fees which that
party may incur as a result.
10.11 Headings. The headings contained in this Agreement have been added
for convenience only and shall not be construed as limiting or used in the
interpretation of this Agreement.
10.12 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original document, and all of
which, together with this writing, shall be deemed one instrument.
[Remainder of Page Intentionally Left Blank]
20
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement,
including the Exhibit attached hereto and incorporated herein by reference.
AKESIS PHARMACEUTICALS, INC. GENDER SCIENCES, INC.
By: /s/ XXXX XXXXXXX By: /s/ XXXXXX XXXXX
------------------------------------ -------------------------------------
Name: Xxxx Xxxxxxx Name: Xxxxxx Xxxxx
------------------------------------ -------------------------------------
Title: President and CEO Title: Chairman
------------------------------------ -------------------------------------
[Signature Page to License Agreement]
21
EXHIBIT A
Licensed Patents as of the Effective Date
1) US Patent 5,962,030, issued October 5, 1999 - "Dietary Supplement
and Method of Treatment for Diabetic Control"
2) US Patent 6,203,819 issued March 20, 2001 - "Dietary Supplement and
Method of Treatment for Diabetic Control"
EXHIBIT B
Product
Any product, other than an FDA approved drug or prescription
pharmaceutical product, in any form, formulation, or derivative hereof
developed or based on the following micronutrient supplements:
Akesis Product Label (attached)
